High-Stakes Deep Gas Play: Montex Drilling’s $2 Billion Bet on Louisiana’s Subsurface Wealth
The pursuit of energy riches often demands audacious vision and immense capital, a reality powerfully embodied by Montex Drilling Company’s latest venture. Led by CEO Gloria Moncrief, the firm is currently engaged in one of the U.S. energy sector’s most ambitious undertakings: the Highlander 2 natural gas well. This monumental project, situated deep within Louisiana’s sprawling Atchafalaya River Basin, represents a multi-hundred-million-dollar commitment to unlock ultra-deep reserves that many others have deemed too risky or complex.
Moncrief’s day often begins with a journey to the remote drilling site, a testament to the demanding logistics of deep exploration. The expedition involves an hour-long flight from Fort Worth, Texas, followed by a significant drive and a boat trip through the heart of North America’s largest swamp. Upon arrival, a towering 150-foot derrick and roaring engines announce the presence of a formidable drilling rig, a scene of raw industrial power where roughnecks tirelessly manipulate 40-foot lengths of steel pipe.
Unlocking the Ultra-Deep: The Highlander 2 Project’s Ambitious Scope
The Highlander 2 well is no ordinary endeavor. Montex Drilling has been sustaining operations at an extraordinary rate of $300,000 per day to rent the specialized rig and maintain a 24/7 crew of 60 personnel working rigorous 12-hour shifts. This massive investment has culminated in the drilling of the second-deepest natural gas well ever in the United States, reaching an astonishing depth of 30,862 feet – nearly six miles below the surface. After 389 days of continuous drilling, the well recently intersected an impressive 800-foot-thick gross zone of sand, believed to be saturated with trillions of cubic feet of natural gas.
The successful completion of the drilling phase marks a pivotal milestone, yet it is merely the first act in a much larger financial commitment. Montex has already deployed $300 million into the Highlander 2 drilling. Now, the company seeks strategic partners to secure an additional $2 billion. This significant capital infusion is crucial for connecting the well to infrastructure, constructing a vital gas processing plant, and ideally, funding the drilling of five more super-deep wells to fully monetize the discovered reservoir. This substantial capital requirement underscores the scale of opportunity and risk inherent in pioneering ultra-deep resource development.
A Legacy Forged in Oil and Resilience
Gloria Moncrief’s tenacious pursuit of the Highlander 2 is deeply rooted in her family’s illustrious history within the oil and gas industry. The Moncrief legacy traces back to 1927 with her great-grandfather, William A. “Monty” Moncrief, whose perseverance led to the discovery of a billion-barrel East Texas oil field in 1931 after numerous dry holes. His son, William A. Jr. (Tex), expanded the enterprise significantly, building one of America’s premier family oil outfits with backing from notable investors and making the inaugural Forbes 400 list in 1982. This era also saw the tapping of Wyoming’s giant Madden Deep gas field in 1972.
The family’s journey has not been without its challenges. In 1994, Moncrief Oil faced an IRS raid, resulting in Tex Moncrief settling with tax authorities for $23 million in 1996. Internal family dynamics have also tested the company’s leadership. Following the passing of both her father, Charlie, and grandfather, Tex, in 2021, Gloria successfully navigated legal challenges from her uncle to assume control, demonstrating a formidable resolve to lead the family enterprise.
Moncrief’s personal connection to ultra-deep drilling began early. In 2009, during her first days in the family business, she witnessed a pitch from mining titan James Robert Moffett regarding a deep prospect in Louisiana, a site ExxonMobil had previously abandoned after spending $300 million. Moffett’s vision for immense gas reservoirs hidden in 100-million-year-old rocks captivated the Moncrief family, leading them to acquire a 10% stake in Moffett’s Davy Jones well. Despite the Davy Jones well’s mechanical failure in 2012 due to extreme downhole conditions, the experience solidified Gloria’s conviction in the potential of ultra-deep formations. A precursor, the original Highlander well, completed in 2014 with Moncrief holding a 10% stake, delivered 75 million cubic feet of gas daily, generating approximately $80 million annually in revenue at current prices, before its unfortunate destruction by water infiltration in January 2023.
Strategic Timing: LNG Export Drives Deep Gas Viability
Despite the historical skepticism surrounding ultra-deep drilling, especially with the rise of abundant shale gas, Moncrief remains steadfastly bullish. The strategic rationale behind this conviction lies in America’s burgeoning liquefied natural gas (LNG) export market. The proliferation of shale gas spurred the construction of numerous gas-hungry LNG export terminals along the U.S. Gulf Coast. Crucially, these terminals are geographically close to Moncrief’s Highlander project. By late 2027, Moncrief anticipates connecting Highlander 2 to one of several existing gas pipelines situated just miles from the site, positioning the project to directly supply this high-demand export market.
This advantageous market alignment transforms what was once considered economically marginal into a potentially lucrative play. The demand from LNG exporters provides a robust and premium market for the vast quantities of natural gas that Highlander 2 is poised to deliver, justifying the substantial upfront investment and technical challenges.
Investor Spotlight: Opportunities in the LNG Export Value Chain
For investors keen on leveraging the robust growth of natural gas exports, several established entities offer compelling opportunities. Cheniere Energy stands out as a leading player, generating consistent revenue from its two significant liquefaction facilities located in Texas and Louisiana, where LNG is processed and loaded onto ships for global distribution. The company’s enterprise value, calculated as debt plus the market value of common shares, currently trades at approximately ten times the $7.5 billion in earnings before interest, taxes, and depreciation (EBITDA) projected for this year. Furthermore, its stock is valued at 16 times the $15 per share in cash flow after capital expenditures estimated for 2026 by Value Line, signaling a reasonable valuation for a growth-oriented infrastructure firm.
Another option for income-focused investors is Cheniere Energy Partners. This entity specifically owns the Louisiana terminal and a key associated pipeline, offering a direct stake in critical export infrastructure. It currently provides an attractive dividend yield of 5%, though investors should note the requirement for K-1 tax filings. Both companies provide a pathway to participate in the expanding global demand for U.S. natural gas, benefiting from the very market dynamics that underpin Montex Drilling’s bold Highlander 2 strategy.
Charting the Future: A Vision for Energy Independence
Gloria Moncrief’s unwavering commitment to the Highlander 2 project reflects more than just a family legacy; it represents a strategic vision for unlocking significant energy resources that can help meet burgeoning global demand. Despite personal and professional turbulence—from family litigation to the destruction of the original Highlander well—her resolve remains unshaken. With the potential to deliver trillions of cubic feet of natural gas to an eager LNG export market, the Highlander 2 project, though costly and complex, is strategically positioned for substantial long-term returns, underscoring the enduring opportunities for growth and innovation within the U.S. oil and gas sector.